Wells Fargo & Co. is set to raise its minimum hourly pay levels in a majority of its U.S. markets by a maximum of about 32 percent based on various factors such as cost of living in different markets. The pay increases, which will take effect by the end of 2020, will impact more than 20,000 U.S.-based employees.
The hourly pay will be based on employee location up to a maximum of $20 in the highest-cost markets and $15 at the lowest-cost markets.
“Our employees are our most valuable resource, and these pay increases are just one way we are investing in our people and ensuring that Wells Fargo continues to be a great place to work,” said CEO Charlie Scharf.
The hourly increase takes into account the cost of living in each Wells Fargo market, like employees in New York or San Francisco receiving a rate of $20 per hour and employees in Charlotte or Des Moines receiving a rate $16 per hour.
In recent years, Wells Fargo has increased its minimum hourly base pay in the U.S. by 32%, most recently to $15 in March 2018.
Wells Fargo has recently been investing in enhancing multiple compensation programs and employee benefit schemes, primarily for U.S.-based employees in the lower part of the pay range.
The company made changes to its healthcare scheme to make it more affordable for employees at lower pay range, lowering or keeping premiums flat for about 70 percent of employees.
On average, the company pays 84 percent of the total annual healthcare premiums for its U.S.-based employees who earn less than $40,000 annually. This equates to about $5,700 for individuals and $16,600 for families.
Earlier in the year, Wells Fargo also awarded Restricted Share Rights to 250,000 employees in recognition of their contributions and commitment to Wells Fargo and its customers and clients. This amounted to about $2,400 pre-tax per full-time employee at the time of vesting.
Wells Fargo is the latest bank to raise wages for its lowest-paid workers after Bank of America Corp. announced it in November 2019. Bank of America is going to implement its minimum wage of $20 an hour by the end of this month, more than a year ahead of originally planned.
In April, Bank of America had announced it will raise its minimum wage to $20 per hour from $17 over a two-year period by 2021. However, it increased the minimum hourly wage to $17 in May 2019, and will increase it to $20 now. Two years ago, the company had raised it to $15 per hour.
In a landmark measure in July 2019, the U.S. House of Representatives passed a bill raising the federal minimum hourly wage for U.S. workers to $15. The Wage Act of 2019 calls for a gradual increase in the federal minimum wage from $7.25 to $15 by 2025. For more than a decade, there has been no increase in the federal minimum wage – the longest period in U.S. history.
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